Granules India Ltd.
NSE: GRANULESGranules India Ltd.: A 30-second snapshot
Granules India (₹736.2) is a mid-cap pharma API and formulations company that has delivered 60.5% price appreciation over the past 12 months, supported by FY26 revenue growth of ~20% and Q4 PAT growth of 33% YoY. The stock trades at a trailing PE of 30.2 and forward PE of 19.1, above most large-cap pharma peers in the sample, and sits 13.9% above its 50-DMA and 28.8% above its 200-DMA. Historical ROE consistency is low — 13.52% current ROE, above 15% in only 1 of the available years — even as 5-year earnings CAGR of 31.3% points to a recent acceleration.
P/E
30.2
Forward P/E
19.1
ROE
+13.5%
Debt / Equity
29.73
Profit Margin
+11.1%
Div. Yield
+0.2%
5Y ROE > 15%
1/5
5Y FCF > 0
4/5
Quality
59/100
News
8 headlines · 6 positive · 0 negative
Granules India FY26 Revenue Rises 20%; Earnings Call Highlights Strategy - scanx.trade
scanx.trade
Granules India Reports Strong FY26, Q4 PAT Jumps 33% to Rs 2,016 Mn - Medical Dialogues
Medical Dialogues
Granules India Standalone March 2026 Net Sales at Rs 876.82 crore, up 14.17% Y-o-Y - Moneycontrol.com
Moneycontrol.com
Granules India Q4 Results: Stock at record high after strong operating performance; Profit up 32% - CNBC TV18
CNBC TV18
Buy Granules India; target of Rs 820: Motilal Oswal - Moneycontrol.com
Moneycontrol.com
Recent context
- ·FY26 full-year revenue rose ~20% and Q4 standalone net sales grew 14.2% YoY to ₹876.8 crore, with PAT up 33% to ₹201.6 crore, driving the stock to a 52-week high in late April 2026.
- ·Motilal Oswal issued a note citing a price target of ₹820 after Q4 results — the stock at ₹736.2 is approximately 10% below that stated target; this is a named-broker stated view, not an editorial endorsement.
- ·News flow across 8 recent items is uniformly constructive (6 positive, 2 neutral, 0 negative), centred on earnings beats and management commentary on strategy; no adverse regulatory or FDA-related headlines are present in the current news set.
Strengths
- +FY26 revenue growth of ~20% and 5-year earnings CAGR of 31.3% reflect a sustained top-line and bottom-line expansion phase uncommon among mid-cap generics peers.
- +Quality score of 55 ranks 1st among 6 sector peers in the comparison set, ahead of SUNPHARMA (50), MAXHEALTH (54), APOLLOHOSP (42), CIPLA (24), and DRREDDY (17).
- +Price action of +60.5% over 12 months with the stock now 28.8% above its 200-DMA and only 3.3% below its 52-week high reflects broad-based momentum; FCF has been positive in 4 of the available historical years.
- +Forward PE of 19.1 represents a material compression from trailing PE of 30.2, suggesting the earnings base is expected to grow significantly in the near term per consensus estimates.
Weaknesses
- −Historical ROE of 13.52% has exceeded 15% in only 1 of the available years and the consistency score is 30/100 — earnings quality has been cyclically uneven and has not established a durable above-15% ROE track record.
- −Debt-to-equity of 29.7 is on a rising trend; in a capital-intensive generic pharma business, accumulating leverage alongside an inconsistent ROE history increases sensitivity to interest-rate and pricing-environment shifts.
- −Profit margin of 11.09% is modest for a pharma business and leaves limited buffer against raw material cost pressures, regulatory compliance costs, or US FDA audit outcomes that are typical headwinds for Indian generics exporters.
- −5-year revenue CAGR of 22.8% and earnings CAGR of 31.3% embed a high growth expectation into the current valuation; any quarter where growth normalises meaningfully could compress the forward PE expansion thesis.
Open questions
- ?Does the 5-year earnings CAGR of 31.3% reflect structural operating leverage in Granules' API-to-formulations integration model, or is it partly attributable to a benign pricing cycle in paracetamol and ibuprofen that may not persist?
- ?Given that D/E of 29.7 is on a rising trend and ROE has been above 15% in only 1 historical year, how has management described its capital-allocation priorities — further capacity expansion or debt reduction — in the FY26 earnings call?
- ?With the stock 28.8% above its 200-DMA and RSI near the upper neutral boundary, what level of earnings-growth deceleration would be required for the forward PE of 19.1 to revert to the trailing PE of 30.2, and how does that compare to historical growth volatility?
- ?The quality score of 55 ranks first among the six peers sampled, yet the absolute score leaves significant room — what specific metrics (ROCE trajectory, FCF yield, margin stability) would need to improve for Granules to close the gap toward a quality score above 70?
Peer comparison: Pharma
Ranks 1 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| GRANULES | Granules India Ltd.You're viewing | 30.2 | +13.5% | 55 |
| Industry avg | across 5 peers | 46.9 | +11.8% | 37 |
| MAXHEALTH | Max Healthcare Institute Ltd. | 72.4 | — | 54 |
| SUNPHARMA | Sun Pharmaceutical Industries Ltd. | 41.3 | — | 50 |
| APOLLOHOSP | Apollo Hospitals Enterprise Ltd. | 64.5 | — | 42 |
| CIPLA | Cipla Ltd. | 29.8 | +11.7% | 24 |
| DRREDDY | Dr. Reddy's Laboratories Ltd. | 26.7 | +11.8% | 17 |
Technical state
Current price
₹736.20
SMA 50
₹647.21
SMA 200
₹571.70
RSI (14)
68.8 (neutral)
From 52w high
-3.3%
1Y return
+60.5%
3M return
+27.2%
50-DMA
Above
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- mediumROE of 13.52% has exceeded 15% in only 1 of the available historical years and the consistency score stands at 30/100, indicating uneven earnings quality across the business cycle.
- mediumDebt-to-equity of 29.7 with a rising debt trend; in a capital-intensive generics business, sustained leverage accumulation warrants close monitoring against FCF generation (FCF positive in 4 of available years).
- lowRSI at 68.78 is approaching the upper boundary of the neutral range; stock is up 60.48% over 12 months and 27.18% over 3 months, trading 3.31% below its 52-week high with the nearest resistance at ₹761.4.
- lowAnalyst coverage is thin at 7 analysts; mean rating of 1.71 on a 1–5 scale (lower = more constructive) is a small sample and subject to revision-concentration risk.
Cross-section contradictions
- Q4 FY26 PAT grew 33% YoY and 12-month price gain is 60.48%, yet trailing ROE of 13.52% has been above 15% in only 1 historical year — the forward PE of 19.1 vs trailing 30.2 implies the market is pricing in sustained margin expansion that the historical ROE track record does not yet confirm.
- News sentiment is uniformly positive (6 positive, 0 negative out of 8 items) and the stock is 13.9% above its 50-DMA and 28.8% above its 200-DMA, yet the consistency score of 30/100 and rising debt trend represent a fundamental quality gap that the recent price strength has not resolved.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 24 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days